Video Excel Online Structured Activity: ROE and ROIC Baker Industries' net income is $25000, its interest expense is $5000, and its tax rate is 40%. Its notes payable equals $27000, long-term debt equals $75000, and common equity equals $240000. The firm finances with only debt and common equity, so it has no preferred stock. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. X Open spreadsheet What are the firm's ROE and ROIC? Round your answers to two decimal places. Do not round intermediate calculations. ROE ROIC Check My Work % % Reset Problem

Video Excel Online Structured Activity: ROE and ROIC Baker Industries' net income is $25000, its interest expense is $5000, and its tax rate is 40%. Its notes payable equals $27000, long-term debt equals $75000, and common equity equals $240000. The firm finances with only debt and common equity, so it has no preferred stock. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the questions below. X Open spreadsheet What are the firm's ROE and ROIC? Round your answers to two decimal places. Do not round intermediate calculations. ROE ROIC Check My Work % % Reset Problem

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 4TP: You are considering two possible companies for investment purposes. The following data is available...

See similar textbooks

Similar questions

Calculate the equity multiplier (total assets / total equity) for the firm below. Make sure you do NOT convert your answer and keep 2 decimals for your final answer.....for examples, if you calculate 6,000/400 = 15, you should enter 15 into BB to be marked correct. Sales $5,000 COGS $1,200 Depreciation $800 Interest $500 Net Income $200 Total Assets 5000 Total Equity 1400
Use the following scenario to solve A-C. H2X Incorporated has accounts payable of $400,000 (a typical amount for the company, non-interest bearing), a bank loan of $700,000 at 9% interest rate, a bank loan of $1,000,000 at 6.5% interest rate, and equity of $2,800,000. Its income tax rate is 32%. Management estimates the company’s cost of equity is 14%. A. What is the company’s weighted average cost of capital on non-interest-bearing debt, interest bearing debt, and equity (or total invest capital)? a. 11% b. 10% c. 9% d. 12% B. Company managers are considering selling more stock to raise $500,000 of new equity to purchase $500,000 of new manufacturing equipment. What would the new weighted average cost of capital be if this plan were implemented? a. 10% b. 12% c. 9% d. 11% C. Company managers are projecting that the new manufacturing equipment from question 15 will produce a return on assets of 11%. Should the company proceed with this plan? a. No, because…
The President of Paroy, has asked you to gather some statistics about his Company’s solvency. You have compiled the following data: Net Income Income Tax Rate P 900 000 34% Total Liabilities Total Stockholders 2 048 000 Interest Expense 100 000 Equity 4 352 000 REQUIRED: Using these data, calculate: 1.)Times interest earned ratio 2.)Debt ratio 3.)Equity ratio
Here is a simplified balance sheet for Caterpillar Tractor: Caterpillar Tractor Balance Sheet ($ in millions) Current liabilities 46,838 Long-term debt Current assets $42,527 Long-term assets Total $89,365 Total Market value Market value added Other liabilities Equity Caterpillar has 660 million shares outstanding with a market price of $86 a share. a. Calculate the company's market value added. (Enter your answers in millions.) Market-to-book ratio Yes O No GA $ GA $29,752 27,755 14,323 17,535 $89,365 b. Calculate the market-to-book ratio. (Round your answer to 2 decimal places.) million million c. Has the company created value for shareholders?
Excel Online Structured Activity: TIE ratio MPI Incorporated has $6 billion in assets, and its tax rate is 35%. Its basic earning power (BEP) ratio is 10%, and its return on assets (ROA) is 4%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below. X Open spreadsheet What is MPI's times-interest-earned (TIE) ratio? Round your answer to two decimal places. X
Now ant evaluating the balance sheet for Mari Corporation. from the balance sheet you find the following balances Cast and marketable securities = $420,000, Ramunds Race hase = $ 80000 inventony = $t. 120.000. Prepaid Rent Expense= $360. 000 Accrued Taves = $24.00 Accounts Payeble = $1.030.000 Notes Payable = $ 370.000 Net Profit After Tax $ 250.000 What is the amount of Marin's Net Working Capital?
Please see attached image for the question also please show working. Data for Barry Computer Co. and its industry averages follow. The firm's debt is priced at par, so the market value of its debt equals its book value. Since dollars are in thousands, number of shares are shown in thousands too. Barry Computer Company: Balance Sheet as of December 31, 2018 (In Thousands) Cash $123,525 Accounts payable $219,600 Receivables 494,100 Other current liabilities 164,700 Inventories 329,400 Notes payable to bank 150,975 Total current assets $947,025 Total current liabilities $535,275 Long-term debt $384,300 Net fixed assets 425,475 Common equity (45,292.5 shares) 452,925 Total assets $1,372,500 Total liabilities and equity $1,372,500 Barry Computer Company:Income Statement for Year Ended December 31, 2018 (In Thousands) Sales $2,250,000 Cost of goods sold Materials $1,102,500 Labor 450,000 Heat,…
MPI Incorporated has $6 billion in assets, and its tax rate is 35%. Its basic earning power (BEP) ratio is 8%, and its return on assets (ROA) is 4%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below. X Open spreadsheet What is MPI's times-interest-earned (TIE) ratio? Round your answer to two decimal places.
RESUBMITTED : Please see attached image for the question also please show working. Please answer questions a and b Data for Barry Computer Co. and its industry averages follow. The firm's debt is priced at par, so the market value of its debt equals its book value. Since dollars are in thousands, number of shares are shown in thousands too. Barry Computer Company: Balance Sheet as of December 31, 2018 (In Thousands) Cash $123,525 Accounts payable $219,600 Receivables 494,100 Other current liabilities 164,700 Inventories 329,400 Notes payable to bank 150,975 Total current assets $947,025 Total current liabilities $535,275 Long-term debt $384,300 Net fixed assets 425,475 Common equity (45,292.5 shares) 452,925 Total assets $1,372,500 Total liabilities and equity $1,372,500 Barry Computer Company:Income Statement for Year Ended December 31, 2018 (In Thousands) Sales $2,250,000 Cost of goods sold Materials…
Here is a simplified balance sheet for Epicure Pizza (figures in $ millions): Assets Liabilities and Shareholders' Equity Current assets $ 120 Current liabilities $ 160 Fixed assets 118 Long term debt 28 Equity 50 Total $ 238 Total $ 238 Note: There are 10 million shares outstanding. Epicure shares are currently priced at $8 each. a. What value should be used for debt when calculating the firm's WACC? (Enter your answer in millions.)
You are considering two possible companies for investment purposes. The following data is available for each company. Additional Information: Company A: Bad debt estimation percentage using the income statement method is 6%, and the balance sheet method is 10%. The $230,000 in Other Expenses includes all company expenses except Bad Debt Expense. Company B: Bad debt estimation percentage using the income statement method is 6.5%, and the balance sheet method is 8%. The $140,000 in Other Expenses includes all company expenses except Bad Debt Expense. A. Compute the number of days sales in receivables ratio for each company for 2019 and interpret the results (round answers to nearest whole number). B. If Company A changed from the income statement method to the balance sheet method for recognizing bad debt estimation, how would that change net income in 2019? Explain (show calculations). C. If Company B changed from the balance sheet method to the income statement method for recognizing bad debt estimation, how would that change net income in 2019? Explain (show calculations). D. What benefits do each company gain by changing their method of bad debt estimation? E. Which company would you invest in and why? Provide supporting details.
Calculate the equity multiplier (total assets / total equity) for the firm below. Keep to 2 decimal places and do not convert it. ....for examples, if you calculate 6,000/400 = 15, you should enter 15 into BB to be marked correct. Sales $5,000 COGS $1,200 Depreciation $800 Interest $500 Net Income $200 Total Assets 6000 Total Equity 1300